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U.S. teetering on the edge of fiscal cliff

By Aaron Blevins, 12/13/2012

Rally held at L.A. office of Rep. Karen Bass

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The legislative and executive branches of the federal government are currently in negotiations in an attempt to spare Americans from tax increases and budget cuts that would send the country over the “fiscal cliff” Thelma and Louise-style.

Congresswoman Karen Bass (D-California) encourages demonstrators to let their voices be heard at a fiscal cliff rally on Monday. (photo by Aaron Blevins)

President Barack Obama has proposed a “balanced approach” that cuts spending and extends tax cuts for people with incomes that are less than $250,000, while House Speaker John Boehner has argued that Obama’s approach will hurt small businesses and “destroy” jobs. Republicans have suggested cutting spending and closing “special-interest loopholes” in the tax code instead.

While national leaders are trying to avoid another recession, local residents have organized to put their two cents into the fiscal negotiations, and they did so this week at the steps of their Congress members’ offices.

At the Los Angeles office of Congresswoman Karen Bass (D-California), former members of Obama For America held a rally to explain how a tax increase — estimated at $2,000 per year for families — would affect them.

Writer Marquis Olison told the story of his grandmother, who was the main breadwinner for a family of eight and made ball bearings for aircraft to support her family. He said $2,000 may not mean much to people who can buy a $5,000 bottle of wine, but it will affect the woman who raised him.

“This isn’t just about my grandma,” Olison said. “There are billions of people living their own personal fiscal cliffs every single day — just a flat tire or a traffic ticket away from being in economic ruin.”

Small business owner Corrie Osuna told of her family’s health woes, part of which had to do with renting office space in downtown Los Angeles that turned out to be mold-ridden. While the family is doing better now, she said the fiscal cliff negotiations should be fairer, so everyone can contribute.

“This is something that is really important to all of us,” Osuna said. “We all need to do our part. I’m willing to do my part.”

Pam Lane, who recently celebrated her 70th birthday, said she never dreamed that she would have the financial issues that she’s having now. She recently had an illness that left her bed-ridden for several months, and a $2,000 tax increase would be an “unbelievable burden.”

“This is ridiculous,” Lane said. “I’m a good woman.”

Bass spoke to the group, giving insights into the status of the negotiations. She is confident that the political leaders will reach a deal prior to the Dec. 31 deadline.

“We’re going to get this deal done,” Bass said. “We’re not going to go over the cliff. We are going to raise revenue on those who earn $250,000 and above.”

She said a bill that would increase taxes on those incomes has already passed the Senate and is in the House. Bass said the public will remember how these negotiations play out in the 2014 election.

“They have to decide,” she said. “Are they going to be with 98 percent of the public [and] 97 percent of small businesses or are they are going to focus and send us over the cliff to protect 2 percent of the U.S. population?”

Bass said Republicans seem to have “come to grips with who is going to lead them.” She referenced Grover Norquist, the founder of Americans for Tax Reform who promoted the “Taxpayer Protection Pledge.” Bass said Norquist is the brain behind the Republican’s anti-tax ideology.

“Grover Norquist needs to be sent to the dustbin of history,” she said. “There is finally a crack in his armor. …Everyone should be talking about Grover Norquist. He is the one who is holding our country hostage, and we’ve got to get them to break that pledge.”

Bass said Obama’s re-election victory was telling, and she recited a frequent quote during his campaign: “You cannot balance the budget on the backs of the middle class.”

In a conference call with reporters last week, the congresswoman said that without a deal, the U.S. will face cuts across the board, including discretionary spending for education and healthcare. But she believes that officials will reach a short-term deal.

“I don’t think it will be a grand deal,” Bass said, adding that legislators may not be able to cover some issues in the next two weeks. She speculated that officials will need to return to the “fiscal cliff” issue after Christmas. “That’s just my guess and my prediction.”

Bass said Democrats and Republicans have agreed to $1 trillion in cuts, and that the president is willing to cut more. However, Obama will not accept anything other than a balanced approach that involves spending cuts and revenue generation, she said.

“The president has said this will impact three percent of small businesses,” Bass said, arguing against a Republican claim.

If no deal is made, the country will go back into a recession, which would be “absolutely devastating,” Bass said. She said it could also mean major grief for the IRS, which may need to delay tax returns.

“The big huge thing that needed to happen — Grover Norquist’s armor needed to be broken,” Bass said, adding that Obama’s re-election victory did just that.

In a speech on Tuesday, Boehner said he is hopeful that an agreement will be reached. He criticized Obama for not being serious about the negotiations, and reiterated Republicans’ concerns regarding the impact on small businesses.

“Washington has a spending problem,” he said. “Let’s be honest — we’re broke. And the plan that we’ve offered is consistent with the president’s call for a ‘balanced approach.’”

 

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